Qualities, Prices and Budget Enquiries

Part of the Advanced Studies in Theoretical and Applied Econometrics book series (ASTA, volume 25)


Most “commodities” distinguished in budget enquiries are heterogeneous; often they can be described as “aggregates” of more perfectly homogeneous “qualities.” A consequence of this well-known fact is that an increase of the expenditures on a certain commodity brought about by (e.g.) an increase of income may be caused partly by an increase of the quantity bought (measured in physical units), partly by a transition to a better quality. It may even happen that the quantity is reduced and the increase is wholly caused by an ameliorization of the “quality,” or vice versa. Hence it is clear that the “ordinary” income elasticities1 for heterogeneous commodities derived from budget data will in general be different from the income elasticities for the quantities of these commodities, which are in many cases more interesting.2


Quality Indicator Manual Worker Average Price Income Elasticity Traditional Theory 
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Copyright information

© Springer Science+Business Media Dordrecht 1992

Authors and Affiliations

  1. 1.Economic Research InstituteUniversity of AmsterdamAmsterdamThe Netherlands

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